Tax deductibles - Holiday Cottage

[Lantern House]

We our filing our tax return for the first year trading and would welcome advice as to tax deductible costs in particular if we can claim mortgage interest only payments from the moment we purchased the property although it took us several months to: re-decorate, furnish the property and get our first guest in. Also whether we can claim the re-decoration expenses. Any guidance would be hugely appreciated.

Thanks

www.cotswolds.plus.com

[Raincliffe1]

I suppose the key question might be when were you open and 'available' to trade not exactly when you had the first booking. Repairs and renewals are tax deductable, regards whether there is a 'window' before you are officially trading whereby tax deductable items which you purchase for your business can be included I'm not sure, I think it is possible because when we bought our first hotel the accountant asked for any invoices pertaining to items we had bought beforehand which we intended using in the hotel (I think it was 3 months prior) but that was a good few years ago now. Best check with the accountant to be sure.

[BVC]

Hello, You really should have a brief word with an accountant before filing your first return because you will need to take into account CGT [Capital Gains Tax - edited by the moderator] as well as other things. I would not like to advise you on your own return. Best to get the books set up poperly and then run it yourself from there when you are aware of the pitfalls. BVC